Cargill, Tyson Don’t Expect Immediate Inspector Furloughs

March 2 (Bloomberg) -- Tyson Foods Inc. and Cargill Inc.,
two of the largest U.S. meat processors, don’t expect potential
furloughs of meat inspectors due to federal budget cuts to occur
before at least April.

Tyson, the largest U.S. processor of chicken and beef,
doesn’t expect an immediate impact, Gary Mickelson, a spokesman
for the Springdale, Arkansas-company, said in an e-mail
yesterday. Cargill doesn’t anticipate any changes until at least
April, Mike Martin, a spokesman, said in an e-mail.

The U.S. Department of Agriculture was considering
furloughing inspectors for 15 days as part of automatic federal
budget cuts that were set to take effect yesterday, the National
Chicken Council said in a Feb. 11 letter with other trade
groups. Meat, poultry and egg processors are prohibited from
operating without the presence of federal inspectors, which may
halt production at some plants.

“We are hopeful USDA will formulate a common sense plan
that will not interrupt the production of food for Americans and
consumers around the world who enjoy U.S. meat products,”
Martin said in an e-mail yesterday.

A 15-day furlough may cost the industry more than $10
billion in production losses and workers may lose more than $400
million in wages, Agriculture Secretary Tom Vilsack said in a
Feb. 5 letter to Senator Barbara Mikulski, chairwoman of the
appropriations committee.

Essential Workers

Closely held Cargill is waiting for USDA to determine its
plan, Martin said. Tyson will develop contingency plans after
getting more details from the USDA, Mickelson said. Food
inspectors were “deemed essential” during previous budgetary
impasses, Tom Super, a spokesman for the National Chicken
Council, said in an e-mail.

A furlough of food inspectors “would affect all retail and
food-service companies,” Mike Siemienas, a spokesman for
Supervalu Inc., a grocery-store chain owner, said in a telephone
interview Feb. 26. Sanderson Farms Inc., the third-largest U.S.
chicken processor, said in a filing it would have to shut plants
if inspectors were removed.

The USDA is responsible for the safety of meat, eggs and
poultry products with about 8,400 personnel inspecting the
nation’s 6,300 slaughterhouses and processing plants. The U.S.
Food and Drug Administration handles other products that account
for about 80 percent of the U.S. food supply.

Cargill is tied with JBS SA as the second-largest U.S. beef
processor.